Act Now Or Be Exiled From Main Street

The window for the Main Street Loan Program ("Main Street Program"), designed to provide loans with favorable terms to midsize companies to help address the economic fallout caused by the pandemic, is closing on December 31, 2020. With a capacity of up to $600 billion for providing loans, the Main Street Program to date has originated loans totaling about $4 billion to fewer than 500 borrowers. Loans for the Main Street Program are originated by a qualified banking institution ("Eligible Lender"), which then sells 95% participations in such loans at the full principal amount to a special-purpose vehicle created by the Federal Reserve Bank of Boston ("SPV"). The SPV is scheduled to cease purchasing participations on December 31, 2020, absent action by the Treasury Department and the Federal Reserve System. This alert summarizes the key features of the Main Street Program to provide midsize businesses one last opportunity to evaluate whether to pursue a loan from the